Question: (20 points) A manager has expressed indifference in three cases: Case For Sure or Gamble A $10,000 40% for 0, or 60% for $20,000 B

(20 points) A manager has expressed indifference in three cases: Case For Sure or Gamble A $10,000 40% for 0, or 60% for $20,000 B $15,000 25% for O, or 75% for 20,000 $10,000 50% for 20,000, or 50% for 3,000 All numbers represent gains. a. Calculate the manager's utility for each $ value. (10 points) b. Is the manager risk averse, risk neutral or risk prone? Show your work. (10 points) (20 points) A manager has expressed indifference in three cases: Case For Sure or Gamble A $10,000 40% for 0, or 60% for $20,000 B $15,000 25% for O, or 75% for 20,000 $10,000 50% for 20,000, or 50% for 3,000 All numbers represent gains. a. Calculate the manager's utility for each $ value. (10 points) b. Is the manager risk averse, risk neutral or risk prone? Show your work. (10 points)

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